Speech

Happy customers are good for business

皇冠体育app Business Secretary talks about the importance of good customer service, because without happy customers, there is no business.

This was published under the 2015 to 2016 Cameron Conservative government
AG Swearing in cereomony

Thank you Pete for that kind introduction, and congratulations to everyone who has won an award so far. I think there are still a few more to come!

When I stopped being Culture Secretary, most of my kids decided that my brief period of being 鈥淐ool Dad鈥� was over.

皇冠体育appy liked it when I was working with music, film, TV and sport鈥� Just think of the invites I got, which the kids sometimes thought were invites for them, too!

For some reason they don鈥檛 find things like local enterprise partnerships and the Enterprise Bill so exciting. And they don鈥檛 seem to want a behind the scenes tour of the Department for Business, Innovation and Skills.

皇冠体育app exception is my 14-year-old son, Suli. Because and I promise you this is true, I鈥檓 not making it up, for years now his favourite magazine has been Which?.

I鈥檓 not quite sure how this came about!

Just last week he was revising for his exams. And when my wife and I said he鈥檇 done enough to earn a break, he rushed downstairs and 鈥� for fun 鈥� started devouring the latest edition.

And people say I鈥檓 a bit of a geek!

So I want to start today by saying a really big 鈥渢hank you鈥� to Peter and everyone at Which?. Firstly for giving Suli such a happy childhood! But also because, for almost 60 years now, you have been helping the British do something that really doesn鈥檛 come naturally to us. Complaining.

Let鈥檚 face it, British people are terrible at asserting their rights as customers. I think we just find it unbecoming.

So many of us will 鈥榯ut-tut鈥� and maybe mutter under our breath and even tell our friends how awful our experience was. But we鈥檒l say nothing to the people who are actually responsible, the people in charge.

I only really noticed this when I moved to New York straight after university. I was sat in a diner there, and discovered that even a minor delay in getting your complimentary glass of iced water refilled would prompt a level of outrage that you鈥檇 only see in the UK if somebody jumped the bus stop queue, or something.

This isn鈥檛 just anecdotal.

A recent survey by U-Switch found that 65% of us regularly experience poor customer service, but only a quarter ever actually raise concerns about it.

Of course, that doesn鈥檛 mean they won鈥檛 do anything in response. 皇冠体育app 21st century high street is a very competitive place, there鈥檚 no shortage of options for disgruntled customers.

Growing up in my parents鈥� shop, Kaiza Fashions, I learned from an early age that if we couldn鈥檛 give a customer what they wanted when they wanted it they would quite happily walk down the road and go into a rival business. And one more customer for our rivals meant one less customer for Kaiza 鈥� something that has a real impact on a small business.

Even the largest employers can鈥檛 afford to lose business because of poor service. As Wal-Mart founder Sam Walton put it: 鈥溁使谔逵齛ppre is only one boss 鈥� the customer. And he can fire everyone in the company from the chairman on down simply by taking his business elsewhere.鈥�

In fact when I was a minister at the Treasury I took great pride in helping customers do exactly that, working with banks to create the seven-day switch guarantee. By making it easier for disgruntled customers to leave, the guarantee forced the banks to raise their game.

It鈥檚 a lesson that all businesses of any size should learn from. Because the simple truth is that without happy customers there are no businesses. Without customers there are no profits, no exports, no growth.

That鈥檚 why the Department for Business could just as easily be called the Department for Customers.

Now Nick Boles is doing a great job on the consumer protection portfolio. But I don鈥檛 want you think that our commitment to customer service begins and ends there.

Helping businesses deliver for their customers is at the heart of everything we do in my department, whether it鈥檚 helping companies develop novel and new products customers demand, giving employees the skills they need to serve customers better, or tearing up the red tape that all too often makes it harder for customers to do business with you.

Recently I heard about a 9-year-old girl who had gone along to her local bank to open a savings account.

She wanted somewhere to keep her pocket money safe, and her parents wanted her to learn the virtue of saving money rather than spending it. Responsible behaviour that I鈥檓 sure we鈥檇 all like to encourage.

But before she could open her account, the bank insisted that she watch a video, designed for adults explaining the concept of variable interest rates. She started to fidget when she had to listen to her first-ever initial disclosure statement. And then the bank carefully explained her right to shop elsewhere for buildings and contents insurance, presumably for her wendy house.

Finally the girl who, remember, is only 9 years old 鈥� was asked to sign a disclaimer to say she understood that her personal information would be managed in line with the Data Protection Act, that the bank reserved the right to run a credit check on her, and that her savings were protected by the Financial Services Compensation Scheme. But only up to the first 拢85,000.

Either that last bit was a little unnecessary, or pocket money has gone up a lot since I was a kid!

皇冠体育app poor thing was sent away with 3 separate booklets outlining her account鈥檚 terms and conditions. Not surprisingly, when she got home she asked 鈥淢ummy do I really have to read all this?鈥� To which of course the answer was 鈥淣o dear. Nobody ever does鈥�.

Now I鈥檓 sure that if I was to name the bank involved, they鈥檇 say they鈥檙e only doing this in the first place because of government regulations. And I think that鈥檚 a very fair point 鈥� and it鈥檚 something I鈥檓 determined to change.

When people talk about tearing up regulations they normally just mean ones that cause trouble for businesses. But I want to cut red tape that ties up customers, too. I don鈥檛 want anything to get between you and them. When they choose to spend their money with you, they should be able to do so without government rules getting in the way.

皇冠体育app Enterprise Bill is going to get rid of at least 拢10 billion of needless red tape. Regulations that do not genuinely serve customer needs, which are bad for business and a barrier to growth.

So if you find that your customers are sinking under the weight of bureaucracy, I want to know about it. If your customers tell you that a wall of Whitehall-mandated terms and conditions are getting in their way, I want you to pass that information on to me. How can we focus on the really important stuff that really matters to your customers? In short, how can we get out of your way and help you do business?

That鈥檚 why, when I was in charge of the Department for Culture, Media and Sport, I worked with the telecom companies to ensure mobile phone coverage across 90% of the UK.

Now the easy thing for me would have been to force through some new law that simply mandated it. But by sitting down with the operators and letting them take the lead, I was able to negotiate a 拢5 billion legally binding agreement that delivered for customers without burdening the companies.

Some people believe that I鈥檓 completely against regulation and intervention of any kind, that I think businesses should just be left to get on with it. That would not be entirely true.

I鈥檝e always believed that regulation has 2 very simple roles to play. First, it should benefit and protect customers. And second, it should give companies a fair and transparent framework to operate and compete in. And that鈥檚 exactly what the new Consumer Rights Act will do.

Developed with help both from businesses and from consumer organisations including Which?, it comes into force in October. And it will require that important terms and conditions are included up front, in plain English. Crucial issues written in legalese and hidden away in the small print won鈥檛 be legally binding.

This isn鈥檛 about catching businesses out, or creating another set of rules to follow. By guaranteeing plain English and due prominence, the new system will actually help companies. It will focus minds on what really matters and make it easier for you to develop better, clearer terms and conditions.

皇冠体育app new act will also clarify the muddle of statutory rights. It will help employees from the shop floor to the boardroom understand what is expected of them, and it will let customers know the standards they should be demanding and the means by which they can seek redress.

And, bizarre as it sounds, you actually want those individuals to complain when they have a problem. You don鈥檛 want them to be terribly British and suffer in silence. If that happens, your service will never improve.

I think it was Bill Gates who said your most unhappy customers are your greatest source of learning. If they tell you what you鈥檙e doing wrong, you can do it better.

So we want to get British customers complaining because assertive customers make businesses better. And better businesses grow faster and do more to support the sustainable recovery we鈥檙e building in this country.

But I don鈥檛 want you to think that building good customer relations begins and ends at the till. Businesses don鈥檛 exist in a vacuum. Whether large or small, on the high street or online, businesses are a vital part of the communities they serve. 皇冠体育appy provide jobs and services, obviously. But they are also uniquely placed to support their communities in many other ways.

Just last week I heard that a company in my Bromsgrove constituency, Hugo Technology, is generously supporting a new local rugby team. But the contribution that business makes doesn鈥檛 have to be financial 鈥� over the years I鈥檝e seen businesses organising litter patrols, helping with charity fundraising drives, even hosting political hustings.

皇冠体育appre鈥檚 literally no limit to the ways businesses of all shapes and sizes can give back to their communities. And, as we recover, as a country, from the depths of the record-breaking recession, and the economy continues to grow, your ability to invest in your community grows too.

皇冠体育appre鈥檚 a moral case for doing this, obviously. But it鈥檚 also yet another opportunity to engage with customers, to show that you care about their wider needs. To keep them happy.

That鈥檚 what today is all about, and it鈥檚 what I鈥檓 all about. As Secretary of State, I鈥檒l be doing all I can to help you serve the most important people in any business 鈥� the customers. Because happy customers are good for business. And what鈥檚 good for business is good for Britain.

Thank you.

Updates to this page

Published 17 June 2015